On December 12,
2011, the Compensation Committee of the Board of Directors of Cummins Inc. (the
Company) approved changes to the compensation arrangements of N. Thomas
Linebarger in connection with his previously disclosed appointment to the
position of the Companys Chairman of the Board and Chief Executive Officer
effective January 1, 2012. The changes approved by the Compensation Committee,
which will take effect on January 1, 2012, consisted of an increase in Mr.
Linebargers base salary to an annual rate of $1,125,000 and an increase in his
target annual bonus to 125% of base salary.

On December 12,
2011, as part of its ongoing review of the Companys executive compensation
arrangements, the Compensation Committee also amended the Companys 2006
Executive Retention Plan (the Retention Plan) to reduce the severance
payments that the Company would make to its named executive officers (other
than the Chief Executive Officer) upon a termination of the named executive
officers employment by the Company without cause, or by the named executive
officer for good reason, following a change in control of the Company. The
severance payments were reduced from three (3) times the named executive
officers annual base salary and target bonus to two (2) times his or her
annual base salary and target bonus. The severance multiple of the Chief
Executive Officer remains three (3) times his annual base salary and target
bonus.

In addition to
reducing the severance multiples under the Retention Plan as described above,
the Compensation Committee has taken the following actions with respect to the
Companys executive compensation arrangements:


Made all future equity awards
subject to double trigger vesting, meaning that such unvested equity awards
will not accelerate upon a change in control unless the award holders
employment is also terminated by the Company without cause or by the award
holder with good reason.

SIGNATURES

Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.

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